The FASB Identified Several Objectives of Financial Reporting, Which Are

question 47

Essay

The FASB identified several objectives of financial reporting, which are listed below.Following the list is a series of descriptive statements.
Required:
Match each objective with the appropriate statement by placing the appropriate letter in the space provided.

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Definitions:

Cash Inflow

Money coming into a business or project from various sources, including sales, investments, and financing activities.

Profitability Index (PI)

A calculation that determines the relative profitability of an investment, indicating the ratio of payoff to investment amount.

Internal Rate of Return (IRR)

The Internal Rate of Return (IRR) is the rate at which the net present value of all the cash flows (both positive and negative) from a project or investment equals zero, used as a benchmark to decide the profitability of an investment.

Net Present Value (NPV)

NPV is a financial metric used in capital budgeting to assess the profitability of an investment or project, calculated as the difference between the present value of cash inflows and outflows.